Downsizers are set to pocket a healthy stamp duty discount at the upcoming South Australian state election, with major organizations offering tax breaks to older homeowners in a bid to free up large family homes.
South Australia’s Labor government and the opposition Liberal Party have both promised stamp duty rebates specifically for voters in the March 21 state election.
However, their programs have significant differences in the size of the discount, who actually receives it, and more.
Offering stamp duty permits to older home owners is a new trend as discounts are often offered to first home buyers to help them get into the property market quickly.
Premier Peter Malinauskas announced plans to end stamp duty for downsizers buying new homes on Sunday, while provincial opposition leader Ashton Hurn promised a $15,000 stamp duty rebate earlier this month.
Under the state government’s plan, stamp duty will be waived for people age 60 or older who buy a small, newly built or off-plan home worth up to $2 million.
South Australian stamp discount election programs
| Work | Freedom | |
| Discount amount | Up to $103,830 | $15,000 |
| Age eligibility | 60+ years | Age 55+ |
| Estimated cost of new building | $2 million | $1.2 million |
| New architectural styles | It must be a newly built or off-plan home to live in. It should be smaller than the previous home. | It can be a new or existing location. It should have a lower price than the current building. |
| Current local conditions | N/A | You must have lived in the home for 5+ years. |
People buying a $1 million home who sold their main home will incur a total stamp duty penalty of $48,830, according to government estimates.
It will increase to $76,330 for a $1.5 million home, while a maximum allowance of $103,830 will apply for a $2 million home.
Alternatively, the state’s countermeasures would give people aged 55 and over a $15,000 stamp duty permit for a one-time purchase of a low-cost home, with a total of $1.2 million in new housing.
Detractors are set to receive a stamp duty rebate at the upcoming South Australian state election. Photo: Getty
Eligible people must have lived in the existing home for at least five years, and the work must have taken place within a 12-month period.
Ms Hurn said the stimulus was designed to create much-needed movement in the housing market, opening up thousands of homes for young families.
“South Australians looking to buy a small home are paying more than $50,000 in stamp duty, money that should be there to enjoy their lives in the years to come,” she said.
![Provided with a schematic Aerial image of the Adelaide CBD skyline. Image: Provided by Colliers](data:image/svg+xml,%3Csvg xmlns="http://www.w3.org/2000/svg" viewBox="0 0 800 450"%3E%3C/svg%3E)
Adelaide house prices fell by more than 13% in the year to January. Photo: Getty
“This incentive will keep more money in their pockets, make buying a smaller home more affordable and, ultimately, open the doors to more young families looking to put down roots in a bigger home.”
Mr Malinauskas said his government’s housing program is about building more houses.
“Our plan to abolish stamp duty for downsizers is limited to increasing housebuilding, while also freeing up large family homes,” he said.
SOUTH Australia’s PREMIER Peter Malinauskas has promised to reduce stamp duty for less buyers of new homes. Photo: Sarah Reed/Getty
“By ending the stamp duty, we’re giving older South Australians a real incentive to downsize.”
Both parties also offer stamp duty discounts for first home buyers.
South Australian opposition leader Ashton Hurn has promised a $15,000 stamp duty rebate on new and existing homes for downsizers. Photo: Provided
Stamp duty is a major expense for Australians looking to buy and move home, but it is also a major source of revenue for state and territory governments.
Angus Moore, chief economist at REA Group and author of the Growing Burden of Stamp Duty – PropTrack Report, said stamp duty is becoming more expensive for home buyers.
“The stamp tax is an ineffective tax because it prevents people from going to the homes they deserve,” he said.
Mr Moore said stamp duty reform was urgently needed to allow the property market to function properly.
State and territory governments offer a range of stamp duty concessions for home buyers, most of which are aimed at first home buyers.
However, some states such as Victoria have opened up stamp duty to everyone buying a new home and off-plan property to stimulate new home construction.
Home prices in South Australia have risen in recent years and it has been one of the strongest property markets in the country over the past five years.
Adelaide’s median house price rose 13.6% to $996,000 in the year to January, while unit prices rose 14.6% to $686,000, according to the PropTrack Home Price Index.
At the same time, the median house price in regional SA increased by 12.5% to $501,000, unit prices increased by 13.1% to $460,000.
